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Reluctance to remortgage sees homeowners waste cash
24 January 2008 10:00
Many Britons are unwilling to shop around for a better mortgage deal than the one they have, a new poll has found, resulting in their paying out more than they should.
Nearly half of all homeowners admitted to not regularly reviewing their mortgage, according to Abbey's study, while over one in four divulged that they were not on the best rate available - a situation that typically costs them each an extra £5 a day.
By contrast, it is estimated that if these borrowers did remortgage to a flexible product with a more attractive rate, they could overpay by that same £5 a day and in doing so save an average of £38,432 on their mortgage, while reducing its duration by six years.
Breaking these figures down also showed only one in three people aged between 25 and 34 to be on uncompetitive rates, making them the most astute age group in this respect, whereas two out of three borrowers between 55 and 64 could be on a far better deal.
Abbey's head of mortgages Nici Audhlam-Gardiner said that £5 a day worked out as a significant amount of money and she advised those borrowers not shopping around for their mortgage that they could see immediate benefits if they did so.
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